S&P Global Ratings reaffirms Indonesia’s stable investment-grade rating, bolstering the rupiah and pressuring USD/IDR to 18,110.
The Indonesian rupiah strengthened for a second day, pushing USD/IDR to 18,110 in Asian trading after S&P Global Ratings reaffirmed Indonesia’s investment-grade credit rating with a stable outlook. The agency cited temporary fiscal and external pressures, including elevated oil prices and currency depreciation, as manageable risks.
Bank Indonesia’s 100-basis-point rate hike between May and June, alongside pledges to use all monetary tools, further supported the rupiah. Meanwhile, the US dollar faced headwinds after softer-than-expected US inflation data, with June CPI easing to 3.5% year-over-year from May’s 4.2%.
Market sentiment remains cautious, however, as rising US-Iran tensions and higher oil prices could limit the dollar’s downside by fueling inflation concerns and expectations of prolonged Fed rate hikes.